a) Define the term Financial Portfolio Explain the term "Portfolio Investment" by discussing i) The Modern Portfolio Theory (MPT) ii) Defensive equities-focused portfolio ?

a) A financial portfolio refers to a collection of investments held by an individual or an institution. These investments can include stocks, bonds, mutual funds, ETFs, and other financial instruments. The purpose of a financial portfolio is to diversify risk and maximize returns by spreading investments across different asset classes.

i) The Modern Portfolio Theory (MPT) is a theory developed by Harry Markowitz in the 1950s that suggests investors can construct an optimal portfolio by considering the relationship between risk and return. According to MPT, investors should diversify their investments across different asset classes to reduce risk and achieve a higher return. The theory emphasizes the importance of asset allocation and the benefits of holding a mix of assets with different levels of risk and return.

ii) A defensive equities-focused portfolio is a type of investment portfolio that focuses on defensive stocks, which are typically less volatile and more stable during market downturns. Defensive stocks are often found in industries such as healthcare, utilities, and consumer staples, which tend to be less affected by economic cycles. By investing in defensive equities, investors aim to protect their portfolio from market volatility and generate consistent returns over the long term. This type of portfolio is suitable for investors who prioritize capital preservation and are looking for a more conservative investment strategy.